VAT Confusion

slmaluwa

Hello
I setup a new company and raised a purchase order for 1000 items as follows:

ItemA Price 1/= incl VAT 15% from VendorB
So, I expected the cost of item to be 850/= and VAT is 150/=

But, Navision has posted VAT as 130.43 and Cost of Item as 869.57 (that is around 13%).

How does this amount came and how can I start troubleshoot? No other transaction except this purchase in the DB

Regards

DaveT

Hi

The values are correct. The 15% is the VAT applied to 869.56 to get 1000 i.e. 1000 / ( 1 + 0.15 ).

150 is 15% of 1000 but 17.6% of 850. Think of it the other way around i.e. if 15% VAT and the pre-vat is 850 then the VAT inclusive value would be 977.5 not 1000

Hope this clears it up.

slmaluwa

Yes, I got it now.
What a confusion????

Thank you

DaveT

Gald to help

vijayanderson

I belive what you have done is wrong, There is a seprate struture setup for Price including tax, It would reverse calculate the Tax amount and post it. Its only applicable for sales.
eg:

If price is 10400( including 4% Vat)

It would automatically reverse calculate and post in following way

Assesable value 10000
Vat 4 % : 400

Regards,
Vijay